Buyouts May Make a Comeback

EXECUTIVE MEMO

Buyouts May Make a Comeback

s the federal downsizing toll gets severe later this year, the idea of offering buyouts to entice federal employees to leave their jobs may make a comeback. Last December, six House Members introduced a "soft landing" measure that would provide $25,000 or severance pay, whichever is less, to retirement-eligible employees who leave government by Sept. 30, 1997.

For those leaving after Sept. 30, 1997, but before Sept. 30, 1998, the buyout would be $20,000. It would fall to $15,000 for those leaving after Sept. 30, 1998, but before Sept. 30, 1999.

The bill (HR 2751) allows agencies to offer incentives only if they are cost-effective. This means buyouts would most likely be offered only early in the fiscal year.

The measure also offers incentives for people not eligible for immediate retirement. Re-employment incentives would include full severance pay for those taking private-sector jobs within two months of being laid off from government and decreasing percentages of severance pay for those taking new jobs up to six months after being laid off.

Some agencies could continue paying staffers who left for as long as six months, as long as the employees didn't collect unemployment benefits. Employees who left could also collect as much as $20,000 in relocation incentives through June 30, 2000, if they had to move to take a job with a private firm.

Also under the bill, a private firm hiring a laid-off federal worker could collect up to $20,000 in retraining incentives after the employee had been on the job for a year.

The bill is pending before the House Government Reform and Oversight Committee. Hearings are expected early this year.